What is the deadline for the two party-appointed appraisers to appoint the third appraiser for Azal Coffee?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
If the parties are not able to agree on an independent appraiser within fifteen (15) days of the event triggering the appraisal, each party will select an independent appraiser qualified or certified to make the appraisal. The independent appraisers chosen will then select a third independent appraiser. The third independent appraiser will determine the applicable value and his or her determination will be binding on the parties. You and we agree to select our respective appraisers within fifteen (15) days after the event triggering the appraisal and the two appraisers chosen are obligated to appoint the third appraiser within fifteen (15) days after the date on which the last of the two party-appointed appraisers is appointed. You and we will bear the cost of our own appraisers and share equally the reasonable fees and expenses of the third appraiser. The parties will take reasonable actions to cause the appraiser to complete his or her appraisal within thirty (30) days after the third appraiser's appointment.
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, if an appraisal is required and the parties cannot agree on a single appraiser within 15 days of the triggering event, both Azal Coffee and the franchisee will each select their own independent appraiser. After both appraisers are selected, they have 15 days from the appointment date of the last of the two party-appointed appraisers to select a third independent appraiser.
This third appraiser will then determine the applicable value, and their decision will be binding for both parties. Both Azal Coffee and the franchisee are responsible for covering the costs of their own appraisers. The fees and expenses for the third appraiser will be shared equally between the franchisee and franchisor.
To ensure a timely resolution, both parties are expected to take reasonable actions to ensure the third appraiser completes their appraisal within 30 days of their appointment. This appraisal method ensures an objective valuation process, especially in situations such as transfers or terminations where the value of the franchise needs to be determined.